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Saturday, 30 July 2016

Tommy Thomas : Documentary evidence is overwhelming. US$731 million of corrupt money was credited into his personal account, and his stepson received US$238 million.

TOMMY THOMAS, ONE OF MALAYSIA’S TOP LEGAL BRAINS, CALLS FOR NAJIB TO RESIGN

Our Reporter | July 26, 2016

By :Tommy Thomas

The might of the most powerful nation in the world has been brought to
bear to investigate, uncover and institute legal proceedings to forfeit
assets purchased through money stolen from proceeds of bonds sales by
1MDB.

The combined efforts of three US agencies, the Federal Bureau
of Investigation (FBI), the Department of Justice and the Internal
Revenue Service (IRS), with the assistance of law enforcement agencies
in other countries, have produced the most complete, holistic picture of
the great fraud perpetrated by Jho Low and his co-conspirators to
defraud the people of Malaysia of billions of ringgit ultimately
belonging to them.

The 136-page, 513-paragraph ‘Verified Complaint
for Forfeiture in Rem’ is a tour de force. The people of Malaysia,
suffering under a state of powerlessness and helplessness, owe an
immeasurable debt to the sterling work carried out by truly independent
institutions in the United States.

As a long-time critic of US
domestic and foreign policies, I pay tribute to their selfless work in
exposing the greatest robbery in modern times; what is the Great Train
Robbery of the 1960s compared to 1MDB!

The fact that the US
initiative is brought by its newly established ‘Kleptocracy Asset
Recovery Initiative’ is significant. Thus their complaint asserts that
Prime Minister Najib Abdul Razak is a kleptocrat, a term that was only
coined in the late 1990s to describe African dictators like Joseph
Mobutu, Sani Abacha and Robert Mugabe plundering their own countries.

More than US$3.5 billion in funds belonging to 1MDB were stolen, and
the US complaint seeks the forfeiture and recovery of more than US$1
billion in assets purchased from that stolen money. It represents the
largest single action ever brought by the Kleptocracy Initiative.

The serious allegations against Najib, his stepson, Riza Aziz and Jho
Low for their corrupt dealings have shamed our nation. Through their
action, Malaysia has joined the ranks of the most corrupt nations in the
globe.

One could not have a more succinct description of the
corrupt practices engaged by these persons than what the Complaint
states in Paragraph 6:-

“6. 1MDB was ostensibly created to pursue
investment and development projects for the economic benefit of Malaysia
and its people, primarily relying on the issuance of various debt
securities to fund these projects. However, over the course of an
approximately four-year period, between approximately 2009 and at least
2013, multiple individuals, including public officials and their
associates, conspired to fraudulently divert billions of dollars from
1MDB though various means, including by defrauding foreign banks and by
sending foreign wire communications in furtherance of the scheme, and
thereafter, to launder the proceeds of that criminal conduct, including
in and through U.S. financial institutions. The funds diverted from 1MDB
were used for the personal benefit of the co-conspirators and their
relatives and associated, including to purchase luxury real estate in
the United States, pay gambling expenses at Las Vegas casinos, acquire
more than US$200 million in artwork, invest in a major New York real
estate development project, and fund the production of major Hollywood
films. 1MDB maintained no interest in these assets and saw no returns on
these investments.”

A close reading of the comprehensive document
will indicate that the draftsmen had access to thousands of
incriminating materials, hardly surprising considering the reach of the
FBI and IRS when the US dollar and their banking system are used for
nefarious purposes. Further, the paper trail would have been immensely
damning.

From their advanced state of knowledge, as demonstrated by
the exhaustive nature of the civil complaint, it is only a small step
for the FBI and Department of Justice (DOJ) to next take, that is, to
institute criminal proceedings against the persons referred to in the
complaint. Such criminal proceedings cannot come soon enough for all
right thinking persons.

The US government complaint completely
vindicates the brave reporting of Clare Rewcastle-Brown and the Sarawak
Report, Wall Street Journal, New York Times, the Edge led by its
intrepid editor Ho Kay Tat and P Gunasegaram in KiniBiz. So too the
public statements of Dr Mahathir Mohamad, Tony Pua, Lim Kit Siang and
Ambiga Sreenevasan.

They have been unfairly demonised by the
Malaysian Establishment, for speaking the truth and an apology is due to
them. And Malaysia owes a great debt to Clare Rewcastle-Brown for her
single-minded investigative journalism of the very highest standard.

Because the complaint is in effect a history of the fraudulent dealings
undertaken by 1MDB, under the control of Najib and Jho Low from the
time of its birth, it should be read carefully. No summary can do
justice to its detailed narration: the primary document must be
reviewed.

I propose to focus on the role played by Najib and the
corrupt practice of his step-son, Riza. But before I do so, mention must
be made of the Verification by Robert B Heuchling, Special Agent, FBI
which appears at the last page of the complaint. He has signed the
complaint, thereby confirming the veracity of its contents under the
penalty of perjury, and goes on to state that he has had access to
files, records and information supplied to him by law enforcement
officers.

This signifies personal responsibility on the part of
Heuchling, establishing that he is satisfied with the truth of the
matters complained of. Thus, it would be foolhardy for anyone to simply
dismiss the complaint as a political document by a foreign agency
wishing to undermine the Najib administration.

Najib Abdul Razak

A minor criticism can be levelled against the complaint: its failure to
actually name Najib Abdul Razak. The obvious inference is that it was a
political decision not to shame a sitting prime minister most friendly
to USA and its president. But the legal draftsmen, no doubt irritated by
such political constraint to their freedom to plead in the manner of
their choosing, make it crystal clear that Najib is “Malaysian Official
1”.

Thus, Paragraph 28 states that Malaysia Official 1 “is a
high-ranking official in the Malaysian government who also held a
position of authority with 1MDB”. At all material times, Najib is, and
was, the prime minister, finance minister and chairperson of the
advisory committee of 1MDB. No other member of the government held such
triple functions, a fact expressly recognised in Paragraph 39 of the
complaint.

Just in case any reader of the complaint has any
difficulty in recognising Najib as Malaysian Official 1, it would be
removed by reading the very next Paragraph, that is Paragraph 29
(indeed, the juxta-positioning of the 2 paragraphs is itself
instructive). Riza Aziz is described as “a relative of Malaysian
Official 1”. Riza is the stepson of Najib, and is not related to any
other personality directly, indirectly or remotely involved in the 1MDB
scandal.

In such circumstances, it is absolutely pointless for Najib
and his loyal, diehard supporters to claim that because he is not named
in the complaint, it does not refer to him. Indeed, the complaint
cannot properly be understood in its entirety, unless one understands
Najib’s dominance over 1MDB, as was the political and business reality.

The first reference to wrongdoing on Najib’s part appears in Paragraphs
99 to 102. Paragraph 99 states that US$20 million was transferred
between February and June 2011 into Najib’s now notorious personal
account with AmBank, Kuala Lumpur, from monies stolen from 1MDB.
Paragraph 102 states that this was the same AmBank account which
received US$681 million in March 2013.

The second corrupt action
involving Najib is referred to in Paragraphs 178 and 193, Paragraph 178
states that 1MDB bond proceeds were diverted from their intended purpose
for the personal benefit of among others, Najib, which further
evidences “a misappropriation of public funds”. In the case of Najib,
Blackstone in that transaction transferred at least US$30 million to his
Ambank account: see Paragraph 193.

The third reference to corrupt
monies received by Najib can be found in Paragraph 229 which states that
during a five-day period in March 2013, US$681 million was transferred
from the Tanore account to Najib’s AmBank account, from which US$620 was
returned to the Tanore account in August 2013.

What happened to the
difference of US$61 million, is not mentioned in the complaint. Thus,
it is clear that at least a total of US$731 million was received by
Najib in his Ambank account.

Paragraph 238 is critical. It explains
why creditors were prepared to purchase bonds issued by 1MDB, which is a
company with a paid-up capital of just RM1 million, but able to issue
US$3 billion worth of bonds in March 2013 (to give just one example of
such a bond issue). That is because Najib, as finance minister, signed a
letter of support on behalf of the government of Malaysia.

Regardless of the title of that document, effectively the government was
guaranteeing repayment if 1MDB defaults. Najib was not only prepared to
risk injury to Malaysia’s sovereign immunity by being sued in the
Courts of England, but more importantly was also undertaking to pay
tax-payers monies from the Consolidated Fund, if 1MDB defaults.

In
so signing the letter of support, Najib was placed in a terrible
conflict of interest position: his interest as a beneficiary of corrupt
monies overriding his duty as a public servant elected to protect
taxpayers’ money.

The complaint also focuses on the offering
circular, leading to the issue of 1MDB Bonds. Paragraph 242 states that
the offering circular was misleading because it failed to disclose that
Najib “would receive hundreds of millions of dollars from the proceeds
of the bond sale within days of its closing”.

Paragraphs 259 to 264
deal with a subject familiar to Malaysia: the title to this part of the
complaint reads: “US$681 million was transferred from the Tanore Account
to an Account Belonging to Malaysian Official 1”. Paragraph 259 simply
states:

“Shortly after proceeds of the 2013 bond sale were diverted
to the Tanore Account, US$681,000,000.00 was sent from the Tanore
Account to a bank account belonging to Malaysian Official 1.”

No
guesses needed that this official was Najib, (and no other person).
According to Paragraphs 248 and 249, Eric Tan Kim Loong, a close
associate of Jho Low, was the sole authorised signatory to the Tanore
Account, but in March 2013 1MDB Officer 3 was given signing authority on
the Tanore Account through a Power of Attorney.

Thus, although
Paragraph 262 pleads that RM620 million was returned by Najib to the
Tanore Account, it does not mean that Najib could not have had access to
it, thereafter, since the Tanore Account was controlled by Jho Low.
What is clear is that the monies were not a gift from the Saudi royalty,
but proceeds from bonds issued by 1MDB, which means 1MDB must repay
them. And if 1MDB cannot, Malaysian taxpayers will.

The allegations
levelled against Malaysian Official 1 in these paragraphs of the
complaint are most grave, and indicate a pattern of systematic
corruption, while holding the most important office in the state. Again,
there is absolutely no doubt that although these paragraphs do not
expressly name Najib, it is impossible to think of any other individual
fitting the role.

Riza Aziz

What has so far received far less
publicity is the corrupt monies received by Najib’s stepson, Riza. It is
a classic case of a kleptocrat in charge of the nation’s treasures
plundering them for the benefit of a close relative. Again, Najib placed
himself in a conflict of interest position.

Paragraph 120 of the
complaint begins the case against Riza. It states there that shortly
after receiving proceeds of the two 2012 bond sales from 1MDB, US$238
million was transferred to a Singapore bank account belonging to Red
Granite Capital, a BVI entity owned by Riza.

About US$100 million of
this money was used to purchase luxury real estate in the US and UK for
Riza’s personal benefit, and about US$64 million to fund his movie
production company, Red Granite Pictures. The scheme to defraud 1MDB of
US$238 million is explained in detail from Paragraphs 202 to 219.

Riza Aziz also transferred some US$41 million from the sum of US$238
million to be applied to defray gambling expenses incurred in the
Venetian Casino, Las Vegas by Jho Low, Eric Tan and himself (Riza): see
Paragraph 220 and 226. The final corrupt dealing by Riza was his
purchase of the Qentas Townhouse in posh Belgravia, London for £23
million: see Paragraph 492.

Unprecedented, shocking, massive,
brazen, blatant: one soon runs out of words to describe the scale and
magnitude of the corrupt actions of the wrong-doers. How those who
designed, devised and implemented these dastardly deeds thought they
could escape in the modern, borderless world is itself mind-boggling.

Proceedings in Malaysia

Why were similar proceedings not instituted in Malaysia? After all,
Malaysia is the natural jurisdiction since the company in question,
1MDB, is incorporated and carries on business here. Najib, Riza and Jho
Low are Malaysians. So the nexus to Malaysia is greater than anywhere
else.

Is it not embarrassing for the attorney-general of Malaysia to
be reminded by his counter-part in the United States, under whose
leadership the complaint was brought, that stealing from public funds by
Najib is a criminal offence under Malaysian law. Thus, in Paragraph
499, seven separate offences under our Penal Code are listed as being
violated: three provisions under the Malaysian Anti-Corruption
Commission (MACC) Act are also identified in that Paragraph.

Bank
fraud is a crime under at least three provisions under the Penal Code,
as we are reminded in Paragraph 500. And the entire world knows about
the universal application of Anti-Money Laundering Legislation (like
AMLA) across the globe; a consequence of 9/11. And yet no criminal
proceedings have been commenced in Malaysia!

Former deputy prime
minister Muhyiddin Yassin and former attorney-general Gani Patail will
testify as to what happened to them a year ago when they tried to act
against Najib. Unfortuately, the late Kevin Morrais’ role in the 1MDB
scandal has never been publicly clarified, and remains a matter of
rumour and speculation.

A climate of fear has enveloped all the
senior office-holders of the major institutions of the nation. MACC, the
inspector-general of police (IGP) and Bank Negara have gone silent. The
Public Accounts Committee (PAC) has been disbanded, and the
auditor-general’s report has been marked an official secret.

Because
1MDB was the company which directly suffered losses worth billions of
ringgit, they should have filed civil recovery actions against persons
like Jho Low and Najib, who were supposed to look after their interests
but in fact were plundering it. Since the wrong-doers are still very
much in control of 1MDB, it is not surprising that the company has not
complained, much less resorted to litigation against anyone.

Litigation by other parties have so far been unsuccessful. I should
disclose that I was part of the legal team that acted for some of the
opposition parties and personalities when they sued Najib and 1MDB last
July upon discovery of the US$681 million being credited into his
personal account at Ambank.

The civil suit was summarily struck out
as being wholly without merit, although all the contentions therein,
based principally on the Sarawak Report and Wall Street Journal, have
been corroborated by the US complaint.

Najib must resign

It is
now abundantly clear that Najib Abdul Razak has long forfeited his right
to remain in office as our prime minister. The documentary evidence,
which cannot be denied, is overwhelming. US$731 million of corrupt money
was credited into his personal account, and his stepson received US$238
million. In the eyes of the world he is a kleptocrat, and cannot stay
in office. He must resign immediately.